Entrepreneur, investor and supporter of decentralization, David A. Johnston shared his views on a relatively new concept, dubbed the Smartdrop Model, in July 2018. It explores the different ways SmartDrops are superior than airdrops and encourages future crypto projects to consider its likes. Johnston also took to an interview with CoinDesk, where the former shared his standpoints on the concept.
Johnston supposedly shared with CoinDesk that airdrops should be significant to investors, adding that “a meaningful amount of value” will encourage more participants in what he sees as “the early bootstrapping of a system.” He also revealed that the concept has been applied by existing crypto firms, including Polymath and Dfinity.
Johnston is not the only one to believe that a stronger alternative for airdrops can be implemented, as many investors have expressed a similar opinion. He also believes that new projects take on an improper approach to distributing tokens. Instead of focusing on raising a lot of funds, the investor suggests that projects should lean more towards establishing a sound community that will stick by them throughout the journey.
CoinDesk also revealed Paul Hainsworth’s perspective on SmartDrops, CEO of Open Garden who also plans to implement such a token distribution strategy.
Specifically, he said: “It’s really about trying to demonstrate to exchanges, ‘hey we’ve got a lot of wallets, we’re going to bring you a lot of people, and so let us list our token on your exchange’.”
Johnston does not see the point in conducting Initial Coin Offerings (ICOs) at the very beginning of a project, as it should be done “after you’ve built a community, after you have a real software project,” creating a circle effect in which the main goal always remains building a community regardless of how high one’s grown.
As for Open Garden’s OG token sale, Hainsworth plans to take a different approach that will ensure users make real-life use of the tokens, as opposed to turning to it as merely an investment strategy. This is what he explicitly told CoinDesk:
“We’re launching the product, doing an airdrop to give people tokens so they can start using it in the network, demonstrating utility, and then once we have sufficient utility in the network, then we’ll distribute our tokens to investors.”
Open Garden has a set goal for its token distribution, as they are willing to offer 1 billion OG tokens within its community, starting with its social networking application, FireChat, which has gained nearly 5 million users to date. While how the tokens will be distributed remains unclear in terms of percentage, it has been noted that users’ who bring out “its intended purposes”, are likely to get a generous portion.
When it comes to token prices, Johnston believes that the involved teams should either “go big or go home,” adding that the built community is responsible for the heights a token will reach, hence, “they should get a majority of the reward.”
While Hainsworth is not necessary giving out a big piece of the pie like Johnston believes the way it should be done, he does plan to give away 5 percent of its total tokens, which CoinDesk reported as being a based off of the firm’s maturity level. Their token price will be set at approximately USD$0.01.
To find out more about Open Garden, go to: https://www.opengarden.com